Utility giant SSE has reported a 21 per cent drop in profits in domestic energy supply for the year to March 31 2012.

Perth-based SSE, the UK's second biggest energy supplier with 9.5 million household and business customers, said rising wholesale energy costs and falling consumer consumption were to blame.

However the group, which includes Southern Electric, Swalec and Scottish Hydro, generated a profit of £271.7 million for the year.

Since 2007, consumption of gas across SSE's customer base has fallen by 21.5 per cent and electricity by 16.7 per cent.

SSE raised household gas prices by 18 per cent on average last September.

A 4.5 per cent price reduction announced in January as a result of falling wholesale prices came into force in late March, just five days before the group's financial year end.

SSE has pledged to freeze energy prices until at least October.

The company said less than a fifth of its profits come from retail energy supply, and its wholesale energy and power network divisions helped to lift overall group profits two per cent to £1.33 billion for the year.

Profits from its wholesale business, which includes power generated by renewable energy, were up 6.4 per cent on last year.

SSE has raised its dividend to shareholders by 6.8 per cent to 80.1 pence.

The group said it has delivered better-than-inflation dividends every year since 1999.